We examine the quantitative importance of financial market shocks in accounting for business cycle fluctuations. We emphasize the role financial markets play in reallocating funds from cash-rich, low productivity firms to cash-poor, high productivity firms. Using evidence on financial flows at...

A model of racial discrimination provides testable implications for two features of statistical discriminators: differential treatment of signals by race and heterogeneous experience that shapes perception. We construct an experiment in the U.S. rental apartment market that distinguishes...

This paper provides a new estimation and solution method for a generalized class of sorting hedonic models based on discrete approximations of the distribution of housing quality. Our approach incorporates heterogeneity in preferences and treats quality as latent. Additionally, a housing market...

To detect the presence of predatory pricing, antitrust authorities routinely ask whether a firm sacrifices current profit in exchange for the expectation of higher future profit following the exit of its rival. Because predatory pricing is an inherently dynamic phenomenon, we show in this paper...